FEMA forgives Coast city's $5M-plus Katrina debt

PASCAGOULA — More than $5 million in loans approved for the city of Pascagoula after Hurricane Katrina in 2005 have been forgiven by the Federal Emergency Management Agency.

The city was notified of the decision this week.

After the storm, many businesses and services in Pascagoula shut down, causing the city to lose millions in tax dollars and spend millions in operating expenses. The FEMA loan was to replace some of those lost dollars.

City Clerk Bobby Parker says the original debt for the federal disaster loans was for $7.7 million.

The city has been making payments on the loans. Parker says it now owes a balance of about $2.4 million.

Parker says the money was used after Katrina on utilities and infrastructure, including streets, vehicles and repairs to public buildings.

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